A TECHNICAL VIEW ON CNX--BANK NIFTY FOR --15.7.2020

CNX--BANK NIFTY

Open-21877.60--High-21909.70--Low-21222.45—Close-21392.20 on 14.7.2020

Support:21357/21222.45/21122.10/20926.45/20316/20122.25/20010/19507.

Resistance:21462.40/21768/21807.40/21967/22418--22480/22572.22/22996.40/23080.60/23611.40/23822.

Critical Points moving up: 21661---21932---22152---22418---22480---22572.22—23080.60.

Critical Points moving down:--21357---21222.45---20926.45---20872--20350.

(Bold and underlined figures are most important)

It is exhibiting tremendous weakness and today it sharply plunged down by 697 points. It did break its last important support level of 21357(See my post for 14.7.2020) intraday and made a low of 21222.45 but managed to close above it at the end of the day. It is showing all round weakness on technical parameters, so further fall is not ruled out. But since it has fallen strait by more than 1850 points from the top of 23080.60 in just 4 days, therefore if it holds 21357 or 21222.45 levels then it could stage a pullback before resuming the down move again. Moving down it will find support at 20926---20872---20350---20221---20010 levels and any of these could be the possible correction completion points also, but sustained break below 20010 on the closing basis may signal the end of the uptrend which may please be noted. 

 In view of the above observation, it is in correction mode now but if it holds 21357 or 21222.45 levels then it could stage a pullback rally which can take it to 21661---21932--22152 levels but long trade should be avoided till it gives visible indication of correction completion. However, aggressive traders can try long trade above 21357 & 21222.45 levels or if it closes above 21661 as of now because then it can give a reasonable relief up rally else it will resume the fall again. Since the correction is on therefore short trade should be attempted on the rise in the critical range or on the price breakdown for taking advantage of corrective move or a possible trend reversal.    

Please be alert and vigilant particularly in long trade because the ongoing rally is purely liquidity driven and not backed by fundamentals, therefore possibility of ending this rally mischievously is pretty high. It has already entered into correction mode and may reverse the trend also in coming days.  

NOTE: - If it opens up with huge gap up then wait for it to settle down before initiating long position, but short trade can be attempted on huge gap up if it is near the selling point and vice versa . Since, it is showing volatility so any type of trade should be squared off during the day, if you don’t have reasonable profit margin in the trade. Day squaring off is strongly suggested in any case.

TRADING STRATEGY

1. Buy if it maintains above 21357 or 21222.45 for some time with a stop loss of 21180. It is for the aggressive traders only, because it could be a risky trade.

 

1. Sell on the rise near or within the range of 21735--- 21900 with a stop loss of 22080.

Or

Sell if it moves and maintain below 21222 for some time with a stop loss of 21400. It could be a risky trade but worth trying.

Disclaimer:-The view expressed here are solely of the author and he is not at all responsible in any way for the outcome of the trade you enter based on the above view.

Kindly note that make your cost your stop loss in favourable  trade and then trail it as the price move up/down to gain maximum profit and avoid losses. Use support and resistance levels as entry, exit, target and trailing stop loss points. DO NOT TRADE WITHOUT STOP LOSS.

 

Note: Price stated here are of spot market.

 

Contact me for strategic guidance to enter and exit trade.

 

Thanks 

Narendra Kumar Surana

suranank@gmail.com

Mobile—8240951127/9831313654.